The significance of asset specificity for outsourcing is that if activities that require "transaction-specific investments" are outsourced, the firm will find itself locked-in to its supplier, as it will not want to write off those investments by revisiting the market. This lock-in can then be exploited by the supplier, by renegotiating the terms of the contract or insisting on different terms next time around. This post-contractual lock-in (dependency) will cause the power relation between the two parties to change -- the situation can become one of supplier dominance.